In order to more effectively compete globally against its international competitors, Apple should consider reconfiguring its supply chain to help lower the price of the company's most iconic products, former Apple CEO John Sculley said to Bloomberg News recently.
Currently, the bulk of Apple's mobile device sales come in the United States and Europe, where customers are more willing to pay up to $500 for a new iPhone or iPad. However, thanks to the proliferation of more cost effective smartphones - FierceWireless last December reported on a study from Informa Telecoms and Media, which predicted that 52 percent of all smartphones sold in 2017 will cost less than $150 - Apple's strategy may not be as effective, Sculley said. Instead, the device manufacturer may want to consider using logistics software to overhaul its supply chain.
"Apple needs to adapt to a very different world," Sculley said to Bloomberg. "As we go from $500 smartphones to even as low, for some companies, as $100 for a smartphone, you've got to dramatically rethink the supply chain and how you can make these products and do it profitably."
This increased need for new supply chain software solutions comes about as competitors make better products, Sculley said. While Apple could previously rely on the technological superiority of its products versus competitors' offerings, that dichotomy is no longer the case.
Tim Cook's Supply Chain Management Lessons
However, Sculley said that current Apple CEO Tim Cook has the know-how to further improve Apple's supply chain. In particular, Reuters last September noted that while former Apple CEO Steve Jobs was able to boost the company's fortunes by innovating new products, Cook has been able to steer the business toward success by relying on superior data gathering tools and quick product turnaround times.
"We are positively surprised regarding the pace of the [iPhone 5] rollout, since we had expected a bigger impact from component constraints," Barclays analyst Ben Reitzes said, according to the news source.
In particular, analysts have cited Cook's ability to balance the demands of not only dozens of parts suppliers, but to also manufacture and ship Apple products around the world, all in a period of as few as 10 days, Reuters reported.
Companies looking for similarly quick turnaround times can turn to automated data collection methods like supply chain software. That way, a business is able to track incoming and outgoing shipments in real time, enabling the enterprise to more quickly react to disruptions and to global consumer demand.